4.08.02: Bonus Payments

Bonus payments are payments to employees that are not guaranteed for payment, not associated with additional duties or merit-based activities, or not defined in the contract or union agreement.

Bonus payments are nonreportable compensation for the Defined Benefit plans but should be reported for the Defined Contribution portion of a member benefit plan and for the Personal Healthcare Fund.

  • Bonus payments should not be included in the Employer Reported Wages field on a DTL2 record since all bonus payments are nonreportable compensation for the Defined Benefit plan.
  • Bonus payments must be considered as part of gross earnings when calculating both the member and employer contributions for the Defined Contribution portion of a member benefit plan and for the Personal Healthcare Fund. Include the amount of the bonus with the wages on the Employer Reported Wages field on a DTL4 record.

Examples of nonreportable bonuses include but are not limited to: signing bonuses, termination incentive payments, and other payments not documented in advance. Please contact ORS if you have any questions about the reportability of a payment.

Please note: reportable and nonreportable "compensation" is defined in MCL 38.1303a and only applies to active MPSERS members. For information on reporting earnings for retirees please see section 9.01: Earnings of Retirees Who Return to Work.

Last updated: 05/26/2021